Egan Jones downgrades USA's credit rating again

[pmbug]

Egan-Jones Ratings Co. cut the U.S. credit rating one step to AA, the second downgrade in nine months and two levels below its highest grade, with a negative outlook citing the nation’s increasing debt burden.

U.S. debt has increased to 100 percent of gross domestic product, while debt climbed 23.6 percent from 2008 to 2010, the credit-rating firm said in a statement today. Egan-Jones lowered the U.S. grade to AA+ in a July. ...

http://www.businessweek.com/news/20...dot-rating-one-step-to-aa-citing-growing-debt

:flail:

 

[DSAbug]

gold flying up $1.20 on the news...

When are people going to finally wake up.. sheesh...

 

[ancona]

Silver just got poked in the eye with a sharp stick. Someone doesn't like that it jumped so high.

 

[DoChenRollingBearing]

Egan Jones always seems to be ahead of the curve in rating. I think they are actually being a little bit generous re rating of AA.

Counterparty risk and/or inflation will happen.

Stocks tanking, busted through 50 day MA...

 

[ancona]

When you look at the absolutely abyssmal volumes on the DOW, it is no wonder that something quite small can cause such a huge movement. At this point, it is nothing more than computers at prop desks peeling a little beta off each other, since mom and pop left the building a long time ago.

 

[pmbug]

S&P downgraded US credit rating in August 2011. (note for completeness)

Now, one year after S&P, Fitch is making some noise:

The US-based Fitch rating agency could downgrade the AAA US sovereign credit rating, if the country doesn’t review its tax and spending issues by 2013.

Washington needs to make a plan to address its fiscal and spending issues in a "sensible way," and not with a "slash and burn" approach, David Riley, managing director of Fitch, told Bloomberg TV. “If they can’t really put that together in the first half of 2013, there is a significant threat to the loss of the triple-A rating from Fitch,” he stressed.
...

http://rt.com/business/news/fitch-us-rating-opinion-808/

 

[ancona]

We should ahve been downgraded a long time ago.

 

[pmbug]

... and now Moody's joins the chorus...

...
Budget negotiations during the 2013 Congressional legislative session will likely determine the direction of the US government's Aaa rating and negative outlook, says Moody's Investors Service in the report "Update of the Outlook for the US Government Debt Rating."

If those negotiations lead to specific policies that produce a stabilization and then downward trend in the ratio of federal debt to GDP over the medium term, the rating will likely be affirmed and the outlook returned to stable, says Moody's.

If those negotiations fail to produce such policies, however, Moody's would expect to lower the rating, probably to Aa1.
...

http://www.zerohedge.com/news/moody...rly-divided-congress-does-not-begin-cooperate

 

[benjamen]

... and now Moody's joins the chorus...

http://www.zerohedge.com/news/moody...rly-divided-congress-does-not-begin-cooperate

This is even showing up in the mainstream news:
http://finance.yahoo.com/news/u-aaa-rating-depends-fall-debt-ratio-moodys-133349936--business.html

The dollar is getting hammered by this news. It is bad when the Euro is gaining strength against your currency!

 

[pmbug]

Ratings firm Egan-Jones cut its credit rating on the U.S. government to "AA-" from "AA," citing its opinion that quantitative easing from the Federal Reserve would hurt the U.S. economy and the country's credit quality.
...

http://www.cnbc.com/id/49037337

 

[benjamen]

How dare you downgrade us!
http://finance.yahoo.com/blogs/brea...RhaWQDBHBzdGNhdANob21lBHB0A3NlY3Rpb25z;_ylv=3

"The DOJ says S&P inflated its ratings to gain market share, yet S&P's ratings were in fact in line with the industry. The exclusion of fellow major ratings agencies Moody's Corp. (MCO) and Fitch so far gives the appearance of long-rumored favoritism towards Moody's, in which Warren Buffett of investing and "Buffett Tax" fame is a major shareholder."

"S&P was the only ratings agency to downgrade its rating of the U.S. in August of 2011 during the debt ceiling debate. The move incited rage in DC but may have been the one thing S&P has done right in years as it sent a proper message and didn't damage U.S. credit worthiness in the eyes of the market"

"In the real world, the suit may reduce the likelihood of an agency taking a stance against the U.S."

 

[pmbug]

You are free to speak your opinion as long as we agree with it.